3 Burning Questions Markets Must Answer on Fed Day

Welcome to Fed day… and what a crucial one it could be! While the market is all-but-certain that the central bank will raise interest rates for the first time in three years, nothing is guaranteed—especially with the lack of forward guidance from Chairman Kevin Warsh.

However, if it’s a hike, two more questions will follow. Is it the right decision? A growing number of market watchers fear it would be a mistake. And how many more increases will come in the months ahead? History suggests it’s rarely just one.

The artificial-intelligence trade has many more questions, even some you didn’t know needed answering. Like is Intel the next hot memory stock? It’s in talks with SK Hynix to make chips in the U.S., according to a report Wednesday.

AI regulation poses another query. Nvidia CEO Jensen Huang answered it with an emphatic no again on Tuesday, while Meta ’s Mark Zuckerberg added his voice to the increasingly loud argument against a slowdown in development.

One final question. Can the S&P 500 stop the rot after six declines in the past seven days?

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📈 Here’s what’s happening in markets today:

• Stock futures are bouncing back ahead of the Fed’s rate decision.
• The Fed is set to raise rates. Wall Street is bracing for what comes next.
• Intel, Dell, J.B. Hunt, and more stocks that explain today’s market.
• Higher mortgage rates are a test for Lennar. Watch the home builder’s margins.
• Intel stock surges. How an SK Hynix tie-up would make it a memory chip play.
• Nvidia CEO is Trump’s AI whisperer. What that means for the stock.
• The Clarity Act fails. Where do crypto stocks go from here?
• Salesforce service outages strike on day 2 of Dreamforce conference.
• Tesla’s Cybercab faces safety inquiry. What that means for the stock.
• IBM seals $1 billion government deal to build America’s first quantum foundry.

Created with Highcharts 9.0.1Source: FactSetNote: futures contractsAs of Sept. 16, 9 a.m. ET

Created with Highcharts 9.0.1Nasdaq S&P 500Dow industrialsSept. 15Sept. 16-0.100.10.20.30.40.50.60.7%

🪙 Crypto bill collapses as industry fails to win over Senate

The crypto industry’s top legislative priority failed after Democrats said it didn’t go far enough to rein in President Donald Trump’s personal crypto investments. The Senate now focuses on other issues, snuffing out hope for a crypto bill before the November midterm elections, a decidedly negative turn for crypto companies like Coinbase and Strategy.

🛸 The Star Wars era is upon us, with weapons in space

Star Wars is no longer science fiction. The U.S. Space Force confirmed the existence of space-based weapons, though the details are classified. Still, it’s a milestone in military technology. Space weapons development represents ongoing growth for defense companies like Boeing, Lockheed Martin, Northrop Grumman, and L3Harris. Read more about it here.

📝 Lower mortgage rates are off the table after hitting 7%

Mortgage interest rates have taken the elevator up to 7% with the 10-year Treasury yield at its highest since 2007, and there’s seemingly no relief in sight. Over the past month, daily 30-year fixed mortgage rates tracked by Bankrate are up 0.32 percentage point, the greatest 30-day gain since April, Dow Jones Market Data found. Here’s what’s pushing rates higher.

🔌 This energy company proves data center demand is surging

Artificial intelligence may have triggered doomsday fears about humanity’s future, but one rising energy player is showing that demand for data-center infrastructure isn’t slowing down. Forgent Power Solutions beat earnings expectations when sales for its modular power systems jumped 296% from a year ago as data center demand surges.

🛢️ Oil hits highest level since May ahead of Fed decision

Resurging oil prices are making the Federal Reserve’s job combating inflation more difficult. The central bank is widely expected to raise interest rates later today when it announces the decision. Both major oil benchmarks reached their highest settlements on Tuesday since May.

💳 Wells Fargo finance chief suggests high bar for bank deals

People have privately speculated whether Wells Fargo could acquire a smaller lender. It is no longer subject to a longstanding asset cap that limited its growth, and regulators are signaling a willingness to push through bank mergers. But Wells’ finance chief threw cold water on the idea, suggesting instead a deal tied to payments or tech.

📰 Don’t miss out on our other newsletters

• Review & Preview: Walk the Walk
• Energy Insider: Nuclear Stocks Are Still Too Hot to Handle. How to Play It Safe.
• View From the Circle: How to Buy Retail Stocks When Every Brand Is a Sinking Ship

💸 Don’t miss today’s Moneyist column from MarketWatch

Be sure to read Quentin Fottrell’s Moneyist column today. MarketWatch’s managing editor for advice counsels a reader who has a question about discharging a huge amount of credit card debt in bankruptcy. Read here.

💬 Quote of the day:

Hiking is the wrong choice. — Standard Chartered’s John Davies and Steve Englander, on why the Fed should hold rates steady.

Other headlines moving markets:

• Schwab to pay $1.3 million for failing to spot elder fraud.
• The Tesla roadster will ‘blow people’s minds.’
• Elon Musk is teasing a Tesla and SpaceX merger again.
• Why Cathie Wood dumped crypto stocks.
• Why this Taser maker’s stock was second-worst in S&P.
• Sleep device maker ResMed gets an upgrade.
• Why the Fed’s slam dunk rate hike might be a mistake.
• Skyworks Solutions stock was the S&P 500’s leader.
• GE Vernova is wired to win, this analyst says.
• Why 5% Treasury yields won’t kill the stock market.
• Why one of the last Lilly holdouts just upgraded the stock.
• Target and five other retail stocks that make the grade.
• This ETF should rise as interest rates go up. Is it too late to get in on the fun now?
• Muni bonds are yielding 5%. They rival stocks now.
• What we learned from a volatile Walmart trade.

— Edited by Liz Moyer, Stacy Ozol, and Patrick O’Donnell

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